(a) Incompetence.--In a case where the veteran is incompetent, if no guardian has been appointed, payment shall be made for the benefit of the veteran to the person who is entitled to payment under subsection (b) or, in the absence of any such person and if the veteran is in a facility, to the person in charge of the facility to be expended for the clothing and incidental needs of the veteran. No part of the compensation paid to any facility shall be used for the maintenance of the veteran. A statement from the person in charge of the facility in which the veteran resides shall be evidence to determine the competence of the veteran.

(b) Death.--In the case of the death of a veteran, payment shall be made, in the order named, to the:

(c) Definitions.--As used in this section, the following words and phrases shall have the meanings given to them in this subsection:

“Facility.” Any mental health establishment, hospital, clinic, institution, center, day-care center, base service unit, community mental health center or other organizational unit, or part thereof, which is devoted primarily to the diagnosis, treatment, care, rehabilitation or detention of mentally disabled persons.

“Parents.” Includes persons who, for a period of not less than one year, acted in the capacity of a foster parent to the veteran immediately prior to the veteran having attained 18 years of age.